Summary
GoDaddy closed fiscal 2022 with fourth quarter revenue of $1.04 billion, up 2.0% from the prior-year quarter. Full year revenue reached $4.09 billion, up 7.2% year over year. Operating income was $134.9 million in the quarter, up 8.1%, and $498.8 million for the full year, up 30.5%. Net income attributable to GoDaddy Inc. was $93.6 million in the quarter, up 7.3%, and $352.2 million for the full year, up 45.4%. Operating margin improved to 13.0% in the quarter, up 0.7 percentage points, and to 12.2% for the full year, up 2.2 percentage points.
Operating cash flow was $208.0 million in the quarter, up 20.8%, and $979.7 million for the full year, up 18.1%. Capital expenditures were $17.1 million in the quarter, down 1.7%, and $59.7 million for the full year, up 16.8%. Deferred revenue, current portion, was $1.95 billion at December 31, 2022, up 3.4% from a year earlier. Remaining performance obligations were $2.72 billion, up 3.5%.
Total bookings for the full year were $4.4 billion, up 4.3% year over year, or 6.0% on a constant currency basis. Fourth quarter bookings were $1,051.6 million, up 0.1%. Normalized EBITDA was $1.0 billion for the full year, up 16.1%, with a 25% margin. Fourth quarter normalized EBITDA was $266.0 million, up 4.7%. Free cash flow was $968.6 million for the full year, up 13.2%, and $201.6 million in the quarter, up 16.3%. Unlevered free cash flow was $1.1 billion for the full year, up 14.2%, and $238.2 million in the quarter, up 17.2%. ARR was $3,570.1 million, up 4.0%. Total customers were 20,897, up 0.9%, and ARPU was $197, up 9.7%.
GoDaddy signed a partnership agreement with FIS Worldpay to sell its OmniCommerce solutions for US-based small business customers and bank partners. It launched Managed WooCommerce Stores and implemented payments by default. ARR for applications commerce grew 9% to $1.3 billion. ARR from the Create and Grow group surpassed $445 million, growing 8%. Core Platform ARR grew 1% to $2.3 billion. Commerce gross merchandise volume was $28 billion, up 10%, and gross payments volume reached $760 million. For the first quarter ending March 31, 2023, GoDaddy expects total revenue growth of 4% at the midpoint versus the same period in 2021. For full year 2023, it targets total revenue growth of 5% at the midpoint versus the $4.09 billion of revenue generated for the full year ended December 31, 2022. First quarter 2023 normalized EBITDA margin is expected at 24% to 25%, and full year 2023 normalized EBITDA margin at approximately 26%. Full year 2023 unlevered free cash flow is expected at approximately $1.2 billion, growth of 9% year over year, and free cash flow at approximately $1.0 billion, growth of 3% year over year.
On February 8, 2023, GoDaddy announced a restructuring plan aimed at over $100 million in annualized cost savings through a reduction in force, operating expense reductions and integration of certain European brands and businesses within its Core Platform segment. The plan includes a reduction of approximately 550 employees, about 8% of total employees. Management cited macroeconomic headwinds, inflation, foreign currency movements, interest rates and economic uncertainty as risks. Other risks include competition, security breaches, disruptions from the restructuring, and execution of share repurchases. The company repurchased 17.2 million shares for $1.3 billion from January 1, 2022 through February 1, 2023, at an average price of $77.11, reducing fully diluted shares by about 10% from December 31, 2021.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q4 FY2022 | Q3 FY2022 | QoQ | Q4 FY2021 | YoY |
|---|---|---|---|---|---|
| Revenue | $1.04B | $1.03B | +0.6% | $1.02B | +2.0% |
| General & administrative | $98.6M | $101.6M | -3.0% | $84.9M | +16.1% |
| Total operating expenses | $905.0M | $903.5M | +0.2% | $894.5M | +1.2% |
| Operating income (loss) | $134.9M | $129.7M | +4.0% | $124.8M | +8.1% |
| Operating margin | 13.0% | 12.6% | +0.4 pp | 12.2% | +0.7 pp |
| Net income (loss) | $93.8M | $100.0M | -6.2% | $87.4M | +7.3% |
| Net margin | 9.0% | 9.7% | -0.7 pp | 8.6% | +0.4 pp |
Risks
In December 2022 an unauthorized third party installed malware on cPanel hosting servers that intermittently redirected random customer websites to malicious sites; the company believes the incidents are part of a multi-year campaign by a sophisticated threat actor. Prior incidents include the November 2021 Managed WordPress breach affecting up to 1.2 million customers and the March 2020 hosting credential compromise of about 28,000 customers.
Inflation, rising interest rates, recession risk, and the Russia-Ukraine military conflict could reduce customer spending and make forecasting difficult. MD&A notes 2022 bookings growth was impacted by approximately 170 basis points from adverse foreign currency movements and by uneven demand patterns related to inflation and continued economic uncertainty, while hosting revenue decreased 5.9% partly on lower demand amid the uncertain macroeconomic environment.
The market is highly fragmented and competition is expected to intensify from domain, hosting, presence, commerce, and cloud providers including Google, Amazon, Microsoft, Wix, Squarespace, Shopify, and Cloudflare. Some competitors offer services at low or no cost, such as Cloudflare domains at wholesale and Let's Encrypt security certificates at no cost, which could pressure pricing, margins, and market share.
Substantial indebtedness could adversely affect financial condition and cash flow, with interest expense increasing 16.1% in 2022 to $146.3 million primarily due to higher effective interest rates on variable-rate debt. The company amended its credit facility in November 2022 to add a $1.8 billion 2029 term loan tranche and increased the revolver capacity to $1.0 billion, while debt covenants restrict dividends, distributions, investments, and other actions.
The company faces privacy and data protection laws plus regulatory inquiries following security incidents, including FTC Civil Investigative Demands issued in July 2020 and October 2021 regarding data privacy and security practices. GoDaddy Payments is also subject to money transmission, payment card network rules, and potential penalties or holdbacks that could restrict operations or reduce liquidity.
Future success depends on maintaining strong renewals, and a reduction in renewals even if offset by other revenue would reduce near-term operating margins. The company notes slower growth rates reflect the larger size and maturity of its business, and its small business customers may have limited budgets and allocate resources elsewhere during economic uncertainty.
On February 8, 2023, the audit and finance committee authorized a restructuring plan including a reduction in force of approximately 550 employees, about 8% of total employees. The company estimates $55.0 million to $65.0 million of pre-tax restructuring and exit related charges, with $30.0 million to $40.0 million of future cash expenditures for severance and related benefits.
Starboard Value L.P. reported as of November 2022 that it holds approximately 7.7% of outstanding common stock. Activist involvement could disrupt the business, divert management and employee attention, create perceived uncertainty about future direction, and cause stock price fluctuations.
SaaS KPIs
All quarters →Total bookings
Unlevered free cash flow
Free cash flow
Total customers at period end
Normalized EBITDA
Annualized recurring revenue
ARR (Core Platform)
Summary, forecast, risks and KPIs are extracted from GoDaddy Inc.'s SEC filings for Q4 FY2022 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 2, 2026.